By Rebecca Shabad and Peter Schroeder
Congress has a long list of unfinished business for the fall, with highway funding, tax break legislation, a budget deal and a spending package all awaiting action.
But it’s the need for an increase in the debt limit that looms largest of all.
The nation is again coming close to hitting the “ceiling” for overall debt, which Congress set at $18.1 trillion in February of 2014.
While the deadline for lifting the limit is uncertain, Treasury Secretary Jack Lew warned last month that the “extraordinary measures” now preventing a debt default could be exhausted by the end of October.
Lew is expected to give lawmakers another update on the debt limit after the August recess. When he does, it could be the catalyst for action on a broader fiscal agreement.
“I think that will be the precipitating factor,” said Steve Bell, former staff director to the Senate Budget Committee and senior director of economic policy at the Bipartisan Policy Center.
Assuming Congress passes some kind of spending bill in September to avoid a government shutdown, the debt ceiling will likely be next on the agenda.
The Bipartisan Policy Center predicts the deadline for raising the borrowing cap will arrive in late November or early December.
With the 2016 election on the horizon, some outside experts predict lawmakers will be eager to avoid another dramatic standoff over the debt limit.
“My sense is that lawmakers won’t want to appear dysfunctional at the same time their electioneering goes into high gear,” said Mark Zandi, chief economist at Moody’s Analytics.
Senate Majority Leader Mitch McConnell (R-Ky.) vowed at a press conference before the recess that Congress would ensure the nation’s financial obligations are met. (my emphasis)
READ all of Rebecca Shabad’s and Peter Schroeder’s comments from The Hill here.